Iqvia Holdings, Inc. · NYSE:IQV
Iqvia — Quintiles IMS Holdings — Merger or Acquisition (May 2016)
30 slides from Iqvia's merger presentation, May 3, 2016
Slide 1: Investor Briefing
Investor Briefing May 3, 2016
Slide 2: Cautionary Statements Regarding Forward Looking Statements
Cautionary Statements Regarding Forward Looking Statements This communication contains “forward-looking statements” within the meaning of the federal securities laws, including Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended.
Slide 3: Important Information About the Transaction and Where to Find It
Important Information About the Transaction and Where to Find It In connection with the proposed transaction, IMS Health and Quintiles will be filing documents with the Securities and Exchange Commission (“SEC”), including the filing by Quintiles of a registration statement on Form S-4, and Quintile
Slide 4: Introducing global healthcare intelligence
Introducing Global healthcare intelligence to measure and realize value from R&D and Commercial execution to real world patient outcomes Information-powered, technology-enabled, differentiated solutions to address life science’s most pressing issues 3
Slide 5: At-A-Glance: Transformational Merger of Equals
At-A-Glance 2015 Combined Financial View $23.0B $17.6B $7.2B $1.7B $1.3B 1 1 2 3 4 Enterprise Value Market Capitalization 2015 Revenue 2015 Adj. EBITDA 2015 Adj. UFCF Transformational Merger of Equals (1) As of May 2, 2016 equity market close; net debt as of March 31, 2016 (2) Based on 2015 Quintile
Slide 6: Significant Shareholder Value Creation
Significant Shareholder Value Creation Differentiated and diversified solutions to address massive unmet needs Faster Growth 100-200 bps of anticipated incremental annual revenue growth rate captured by end of year 3 $100M of estimated annual run-rate cost savings by end of year 3 Cost Savings
Slide 7: Merger Summary
Merger Summary • All-stock merger of equals Structure and • Expected to be tax free to IMS Health and Quintiles shareholders Exchange Ratio • 0.384 shares of Quintiles stock to be exchanged for each share of IMS Health stock • Committed financing has been obtained to refinance certain debt Ownership
Slide 8: Transformational Partner to Life Sciences
Transformational World Class Talent Partner to Life Serving World Class Sciences Clients Compelling Multiple Value Financial Profile Creation Levers 7
Slide 9: Two Best-in-Class Businesses
Two Best-in-Class Businesses 2015 • Revenue: $4.3B • Revenue: $2.9B Metrics • Adj. EBITDA / Margin(1): $819M / 19% • Adj. EBITDA / Margin(1): $886M / 30% • >1,100 medical doctors, ~1,050 PhDs, ~850 • >15 petabytes of encrypted and secure data biostatisticians & statistical programmers covering ~90 m
Slide 10: Life Sciences Challenges
Life Sciences Challenges Realize Greater R&D Demonstrate Value & Maximize Efficiency Measure Outcomes Commercial ROI • $140B+ biopharmaceutical R&D • $500bn annual savings through • Margin pressure in spend per year 1 responsible use of meds 4 commercial operations • 34% increase since 2010 in • Pre
Slide 11: Transformational Partner To Life Sciences
Transformational Partner To Life Sciences Game Changing Solutions Realize Demonstrate Maximize Greater R&D Value & Measure Commercial Efficiency Outcomes ROI Technology-Enabled Real World Evidence Smarter CRO Commercial & Connected Health Operations • Equipping therapeutic, • Creating a full lifecyc
Slide 12: Estimated >$230B Market Opportunity
Transformational Partner To Life Sciences Estimated >$230B Market Opportunity Growing At 6-8% Growth Drivers Smarter CRO: • Need: modernize global trial execution Smarter CRO • Opportunity: bring information and technology from design through execution of studies ~$100B Real World Evidence & Connect
Slide 13: The Smarter CRO
Transformational Partner To Life Sciences The Smarter CRO Strategic Levers Value Drivers • Optimally Design Trials - Real-time, data-driven protocol design and feasibility assessment Faster study start-up • Identify & Recruit with Precision & Speed Quicker enrollment - Combined physician, site,
Slide 14: Real World Evidence & Connected Health
Transformational Partner To Life Sciences Real World Evidence & Connected Health Strategic Levers Value Drivers • Create Lifecycle Evidence Partner Improved methods, - Technology-enabled retrospective and prospective speed and win rates approaches to support scientific and commercial needs New o
Slide 15: Technology-Enabled Commercial Operations
Transformational Partner To Life Sciences Technology-Enabled Commercial Operations Strategic Levers Value Drivers • Shape R&D and Commercial Convergence - Align R&D clinical knowledge with commercial analytics and sales execution Higher win-rate Expand outsourcing • Orchestrate Customer Engageme
Slide 16: World Class Talent
World Class Talent ~50,000 Strong Employee Base IMS Health Quintiles 36,000+ employees serving 15,000+ employees serving clients across 100+ countries clients across 100+ countries 1,100+ medical doctors 1,200+ healthcare informatics experts worldwide ~1,050 PhDs 7,000+ employees in ~850 biostatisti
Slide 17: World Class Clients
World Class Clients Large Pharma IMS Health: • 5,000+ clients • Top 25 customers with IMS >25 years on average; 99% retention for top 1,000 customers Small & Mid Size Pharma • RWE engagements in each of the top 25 biopharma companies Generics Quintiles: • Serving the 20 largest global biopharma comp
Slide 18: Compelling Financial Profile: Global Scale and Diversification
Compelling Financial Profile Global Scale and Diversification Combined 2015 Revenue of $2.9B 2015 Revenue of $4.3B 2015 Revenue of $7.2B(1) Asia Pacific Asia Pacific Asia Pacific 15% 21% 18% Americas Americas Americas 45% 45% 46% 40% 34% 36% EMEA EMEA EMEA 2015 Combined Adjusted EBITDA(2) of $1.7B (
Slide 19: Strong Balance Sheet and Free Cash Flow
Compelling Financial Profile Strong Balance Sheet and Free Cash Flow Debt and Leverage(1) at 12/31/15 Gross Debt Net Debt Leverage Leverage 6.0x $4.3B $3.9B $6.8B 4.0x $2.5B $5.4B 4.8x 4.4x $1.5B 2.0x 4.0x 3.1x 3.2x 1.9x 0.0x Combined 2015 Combined Unlevered Free Cash Flow(2) of Est. $1.3B (1) Lever
Slide 20: Accelerating Top-line Growth
Multiple Value Creation Levers Accelerating Top-line Growth Smarter CRO 100-200 bps of Estimated Real World Evidence Incremental Annual Revenue Growth Rate by End of Year 3 Technology Enabled Commercial Operations Note: Actual synergies and other cost savings may differ materially from the current e
Slide 21: Savings to Increase Earnings Growth
Multiple Value Creation Levers Savings to Increase Earnings Growth SG&A IT Infrastructure & Support Annual Estimated Run-rate Cost Savings $100M by End of Year 3 Operations Development Accelerated utilization of IMS Health tax assets will contribute estimated annual cash tax savings of approximately
Slide 22: Accelerating The Momentum of Two World-Class Franchises
Accelerating The Momentum of Two World-Class Franchises Differentiated and diversified solutions to address massive unmet needs Faster Growth 100-200 bps of anticipated incremental annual revenue growth rate captured by end of year 3 $100M of estimated annual run-rate cost savings by end of ye
Slide 23: Appendix: Non-GAAP Financial Measures
Appendix: Non-GAAP Financial Measures 22
Slide 24: Quintiles Net Income to Adjusted EBITDA
Quintiles Net Income to Adjusted EBITDA Twelve Months Ended (in millions) December 31, 2015 Net Income $ 387 Interest expense, Net 98 Income tax expense 159 Depreciation and amortization 128 Restructuring costs 31 Impairment 2 Loss on extinguishment of debt 8 Adjustment to estimated contingent consi
Slide 25: IMS Health Net Income to Adjusted EBITDA
IMS Health Net Income to Adjusted EBITDA Twelve Months Ended (in millions) December 31, 2015 Net Income $ 417 Benefit from income taxes (200) Other income, net (19) Interest expense 169 Interest income (3) Depreciation and amortization 341 Deferred revenue purchase accounting adjustments 10 Stock-ba
Slide 26: Quintiles Unlevered Free Cash Flow
Quintiles Unlevered Free Cash Flow Twelve Months Ended (in millions) December 31, 2015 Net Cash Provided by Operating Activities $ 476 Capital expenditures (78) Free Cash Flow $ 397 Cash interest payments 82 Cash tax payments, net of refunds 121 Loss on debt extinguishment 8 Restructuring payments 2
Slide 27: IMS Health Unlevered Free Cash Flow
IMS Health Unlevered Free Cash Flow Twelve Months Ended (in millions) December 31, 2015 Net Cash Provided by Operating Activities $ 490 Capital expenditures (52) Additions to computer software (131) Free Cash Flow $ 307 Cash interest payments 158 Cash tax payments, net of refunds 92 Acquisition-rela
Slide 28: Quintiles Gross and Net Leverage Ratio
Quintiles Gross and Net Leverage Ratio (in millions) December 31, 2015 Gross Debt $ 2,501 Adjusted EBITDA (for the twelve months ended December 31, 2015) $ 819 Gross Leverage Ratio (Gross Debt / LTM Adjusted EBITDA) 3.1x Cash at December 31, 2015 $ 977 Net Debt $ 1,524 Adjusted EBITDA (for the twelv
Slide 29: IMS Health Gross and Net Leverage Ratio
IMS Health Gross and Net Leverage Ratio (in millions) December 31, 2015 Gross Debt $ 4,266 Adjusted EBITDA (for the twelve months ended December 31, 2015) $ 886 Gross Leverage Ratio (Gross Debt / LTM Adjusted EBITDA) 4.8x Cash at December 31, 2015 $ 348 Net Debt $ 3,918 Adjusted EBITDA (for the twel
Slide 30: Q&A
Q&A 29
Quintiles IMS Holdings — Merger or Acquisition (May 2016) on 6ix